Week 12 - Smart Projects

Week 12

Monday

     We did not have our regularly scheduled class on Tuesday. We had a meeting with Professor Spotts on Monday. The meeting was arranged in order to discuss our Smart Projects and the progress we have made. In our meeting we discovered that we were a bit behind in the process. We were a bit slow to collect our data because it was difficult for us given we are not 21. Our customer would most likely be bars or nightclubs. We are not able to survey bars or nightclubs on our own. So, we had difficulty working with our marketing consulting, Sam, and organizing a time we could bring her to bars and nightclubs. However, between Monday and Thursday we made a considerable amount of ground up and had all of the components to have a worthwhile group meeting on Thursday. We analyzed our data that we did have from patrons and gained a lot of knowledge about our customer. We have a better understanding now of our target market and the behaviors that they exhibit.

Thursday

     On Thursday, we had a joint class with the engineers. We accomplished a lot in this class period. We took the data that we collected and analyzed and used it to make the engineers in our group aware of what the data meant for our product. We also discussed the before during and after of the experience involved in our product. The before includes deciding to go out and the aspects involved in that. The during is the actual act of drinking and the risks involved in that. The after includes the way in which people get home from where they drink, and the risks involved in that. We also discussed the value proposition of our product. This includes how our product solves the painpoints of the customers. It also shows the specific benefits of our product and also tells our consumers why they should buy from us and not our competitors. We also discussed our buyer personas and our customer discovery. The discussions we had helped us to get a better idea of our customer of our product and how they behave.

Chapter 16

     Chapter 16 was not directly assigned to us, however it was the next assignment on the syllabus. So, chapter 16 is largely about advertising and promotions. Advertising, as defined by our book is one-way mass communication about a product or organization that is paid for by a marketer. Advertising could be useful for our Smart Project. It is likely that the type of advertising we would use would be pioneering advertising. Pioneering advertising is a form of advertising designed to stimulate primary demand for a new product or product category. Our product is certainly a new product that does not have a direct competitor in our product category. It would be helpful for us to use this kind of advertising strategy in order to stimulate demand for our new product category. An advertising appeal is a reason for a person to buy a product. Common advertising appeals can be shown here on the right.

Week 11- Distribution and Products

Week 11

Tuesday

     On Tuesday, we talked a lot about supply chains and distribution channels. We talked about Fresh Patch again and discussed their supply chain. The distribution chain is different than the supply chain. The supply chain is the process by which you gain the supplies for your product. The distribution chain also includes the delivery of the product to the consumer. The distribution chain for Fresh Patch starts with an order on their website. Next Andrew receives that order. He then places an order with the producer of the grass in Ventura, California. The producer then ships the product to the consumer. By implementing an east coast distribution center, Andrew could shift his costs from shipping to the distribution center. On Tuesday we also talked about offshoring and nearshoring from chapter 13. Offshoring is the outsourcing of a business process from one country to another for the purpose of gaining economic advantage. Nearshoring is the transfer of an offshored activity from a distant to a nearby country. Both of these tactics are helpful to better the logistics of a company. Logistics is one of the most important aspects of a distribution channel and a successful company. One company that has succeeded because of good logistics is Walmart. Logistics is also a reason Amazon is so successful. It is easier for companies to sell their product through Amazon than it is through their own website. Amazon takes care of the shipping aspect of their business.

Thursday

     On Thursday we talked a lot about product types and where they can be found. We discussed how a Rolex or a Jaguar is a specialty product, a television or a suit is a shopping product, Twinkies are a convenience product, and a septic tank service is an unsought product. Specialty products are a particular item for which consumer search extensively and are very reluctant to accept substitutes. Shopping products are products that require comparison shopping because its usually more expensive than a convenience product. A convenience product is a cheap product that requires little shopping effort. An unsought product is a product that is unknown to the potential buyer or a known product they are not actively seeking. On Thursday we also discussed the intensity of distributions. Intensive includes products that are available everywhere. Selective includes products that are available in select places, such as televisions and suits. Exclusive includes products such as a the Rolex or Jaguar that are only available in very few stores. We also discussed the communication process that is mentioned in Chapter 15. An example of this process is shown in the model above. The sender would be a marketing manager or advertising manager. This advertisement is an encoded message. The channel for this message is media, salespeople, or stores. The decoding of the message is how the receiver perceives the message. The receiver is a customer, viewer, or client. Noise is something that affects the message. This could be something such as other advertisements or news articles that distract from the message. The feedback channel includes market research, sales results, and changes in market shares. This is then adjusted, recycled, and done again.

Smart Project

     For our Smart Project we are currently in the process of collecting data. We will then begin compiling the data as guided from the handout. Our discussions this week can related to our project in some ways. Our product, if we sold it to consumers would likely be a specialty product. It is not an item that is related to many others and so consumers who buy it would be looking specifically for it and not something else. Logistics would not really apply to our product. Our product would most likely be sold to businesses rather than consumers. We are having a joint meeting for our Smart Projects next Thursday, the 13th.

Week 10- Fresh Patch and Chapter 13

Week 10

Tuesday

 

On Tuesday, we discussed the Shark Tank episode on Fresh Patch. Fresh Patch is real grass that is portable and can be used inside your home or on a balcony or porch. It is an alternative to pee pads which need to be replaced immediately. This last two weeks at which time a new one can be sent to you. The main target market for Fresh Patch is dog owners who do not have a backyard or close park to walk their dogs in. It is also targeted at those who feel bad for not walking their dogs often. It is a feel good product. Those who live in Urban areas and live busy lives are main targets as well. On Tuesday we discussed Fresh Patch's income statement. We concluded that the business is above the break even point, making it profitable. We also said that this product is elastic. This means people would likely still buy it even if the price was to change. It is likely that if someone is already willing to spend $25 every two weeks on this product, making it $30 would not deter them from continuing their subscription. At the end of class we also discussed distribution channels briefly and were assigned to create a distribution chart for Thursday. In my chart I discussed how the supply chain went from producer (grass grower in Ventura) to the seller (Andrew Feld) and then to the buyer. Many of these concepts we discussed, primarily supply chains, were discussed in Chapter 13.

Thursday

  

On Thursday, we continued our discussion of Fresh Patch in class. We discussed the income statement and the type of person that would buy Fresh Patch. We also looked at a lot of data of the populations in major cities that had dogs. We found that there were many major cities in which there were a lot of dogs. These cities, we decided, should be the main focus for Fresh Patch to advertise to. We also talked about the retention rate of Fresh Patch. Andrew stated that it was only 25%. So, if Fresh Patch has 2200 customers, only 550 will be consistent subscribers. However, these 550 could make up up to 95% of the sales revenue of Fresh Patch. This is because they continue to buy the product every two weeks. A subscription keeps a constant flow of money for the business. So, a main focus for Fresh Patch should be to retain more of these customers that have only used it once or twice and then stop. Some ways they could do this would be to offer promotions or discounts of subscriptions in the hopes that more people would subscribe as a result. Fresh Patch wants to turn more of their trial users into subscribers in order to increase their sales revenue. A way to do this could be to target the right group of people. Someone who lives in an Urban setting with a dog and makes more than $75,000 a year is an ideal client for Fresh Patch. They would likely become a subscriber due to the helpfulness of this product to them.

 

Chapter 13 

 

Chapter 13 focuses on supply chains and marketing channels. A supply chain is the connected chain of all of the business entities, both, internal and external to the company, that perform or support the logistics function. The supply chain for Fresh Patch includes the producer of the grass in California, the retail which is Andrew, and the buyer or consumer that receives the product. A major part of Fresh Patch is the technological side. All of the transaction for Fresh Patch occur online. Fresh patches Market Channel is a retailer channel. It goes from producer to retailer to consumer. This is B as shown in the image on the left.

Smart Project

Supply chains and market channels can be applied to our Smart Project as well. Our project, Okay to drive, would be a direct channel. We, the producers, would sell the product right to the consumers. This would be A on the image above. The idea of subscriptions and customer retention doe not really pertain to our product. Our product is really a one time purchase, unless it were to break. It is not something that goes bad every few weeks or something that needs renewing.

Week 9- Chapter 19, Meeting & Group Work

Week 9

 Tuesday

     On Tuesday we had meetings by Smart Project group with Professor Spotts. In our meeting, we mostly discussed our surveys. We were shown that we should rearrange our survey so that we do not ask the most direct or serious questions right away. We rearranged our survey and we also put two questions into one question. We also talked about how we would not be able to ask these questions to bars because we are not 21. We came to the conclusion that we could either visit bars that are in restaurants so that we could get in, or we could have Sam, our marketing consultant.We only had to be present in class on Tuesday during our group meetings. That is all we did in class on Tuesday.

Thursday

     On Thursday we spent most of the class with another Smart Project group discussing Chapter 19 and pricing concepts. It is important for us to keep pricing concepts in mind when we create our project. For us, our product has limited competition. This means that we could likely charge a high rate for our product. This also means that our product is not very price sensitive. If we are the only provider of this type of product, a price change would not likely affect sales. If we were to increase prices, but businesses or people still wanted or needed this product, they would likely still buy it, regardless of price. In class Thursday we discussed many questions regarding pricing concepts with another Smart Project group. Our group worked with the ThermoWheel team. It was helpful to have another team in this process. It allowed us to get different ideas from new people that we had not yet worked with. It was very helpful and I feel that the knowledge we gained from it will be valuable in working on our projects going forwards.

Chapter 19

     We also discussed other concepts from Chapter 19. Break even price is the price when total revenue equals total cost. This is important to know when selling a product so you know the best price to charge to not only break even but also make a profit. Factors that affect the break even price include product price, variable costs, and fixed costs. Price bundling is marketing two or more products in a single package for a special price. This is something that we may be able to use in our project. We could add instillation into a bundle or training of bartenders for a special price. The steps in setting the right price on a product goes as shown here on the right. Step one is to establish pricing goals. Step two is the estimate demand, costs, and profits. Step three is the choose a pricing strategy. Step four is to fine tune with pricing tactics. These steps result in finding the right price to charge. This would be a helpful tool to use if we had to price our product if we planned on really taking it onto the market.

Week 8- Mind Map and Smart Projects

Week 8

Smart Project and Mind Maps

     This week was focused on our Smart Projects. On Tuesday, each group met with Professor Spotts to discuss our projects. We discussed our surveys and also our value proposition canvas. We were provided with some helpful direction that will help us to improve and continue our project. We received direct help on how to organize our surveys and also what kind of questions to add in. We also learned that some of our questions were unnecessary and we had to remove them. On Tuesday we also received a binder with all of our old mind maps in it along with a grade for this half of the semester. We were assigned to create a large mind map for the entire semester thus far over break. I will need to include aspects of everything we have covered and link them together into one large mind map. We also met with our marketing consultant this week. She helped us to fine tune our logo and gave us guidance in other areas as well. 

Thursday

I was not present in class on Thursday. However, I have learned from my classmates that we discussed Chapter 11 on developing and managing products. A major theme was the product life cycle. The product life cycle goes as shown on the left. Introduction, growth, maturity, and then decline. We were also introduced to the Shark plan assignment in class. I have selected to do my project on Sway Motorsports. 

Week 7- Gato Cafe and the Value Proposition Canvas

Week 7

Gato Cafe

     This week we talked about the Shark Tank episode on Gato Cafe. Gato Cafe is a business that wants to open store that serves coffee and prepackaged foods and also has cats around the store. The idea is that people enjoy cats and they would be able to relax and reduce stress by coming to this cafe with cats in it. They did not get a deal with any of the sharks and they do not own a store yet. I think this could be a good idea but I think it would struggle to have a large enough market. As we have learned in many chapters, it is essential to have a large target market and know that market. I do not think there would be enough people that would go out of their way to pay extra money for this Gato Cafe rather than just buying their coffee elsewhere. I think families with children would be their many target market. Kids would love to come to this cafe and their parents could bring them occasionally instead of buying a cat for their house. An example of a Gato Cafe can be found above.

Value Proposition Canvas

     We also discussed what is called the value proposition canvas, in class this week. The value proposition canvas helps evaluate a product and see what it has to offer. It is meant to help us understand the gap found between product and customer and also between customer and your substitutes, or competitors. The value proposition canvas can be seen on the left. It helps to lay out the benefits, features, and experience of the product. It also shows us what the customer would want, fear, and need from this product. Lastly, it helps us to see who are competitors are, or substitutes.

 

Value Proposition Canvas for Gato Cafe

     In class we also completed a value proposition canvas for Gato Cafe. It goes as follows:

Product

Benefits: Stress relief, solves issue of hunger or thirst, social gathering
Features: Food, drinks, cats
Experience: Relaxing with cats enjoying a drink or snack

Costumer

Wants: Relaxation, place to bring children who want a cat, stress relief, the experience, food or drink
Needs: Possibly emotion help or therapy
Fears: Allergies, sanitation, aggression in cats

Substitutes

Zoos, coffee shops, pet shops, relaxing places such as spas or resorts.

Conclusion

     From this we can gather a lot about Gato Cafe. We understand that there may be fears from customers that we need to address in order to limit these fears. We also would need to make ourselves stand out from any competition such as pet stores or other coffee shops. It can also help us to focus on our benefits and features and make sure we do the most we can with those benefits to create the best product.

Smart Project

     We can also use the value proposition canvas to help us with our Smart Projects. This would be very helpful for us to visualize our benefits and features. It would also allow us to think as the customer and think of what fears they may have and want they would want or need from this product. We could also better understand our competitors and how to stand out from them and make our product our own.
     

Week 6- Chapter 10 and Phone Soap

Week 6

Chapter 10

Chapter 10 is about Product Concepts. A product is everything, both favorable and unfavorable, that a person receives in an exchange. Products can be either business or consumer products. As mentioned in Chapter 7, a business product is used to manufacture other goods or services. An essential part of a product's success is branding. Branding is about separating your product from other companies, and creating your own image in their minds. A products success depends largely on the businesses ability to distinguish their product from others in the eyes of the consumers. When a business gains exclusive rights to a brand or part of a brand, that is called trademark. Another essential part of a successful product is packaging. Packaging does not only serve the purpose of holding the product. It also creates an image of that product in the consumer's mind. For example, every one knows what a can of Pringles looks like.

Phone Soap

We watched the Shark Tank episode on PhoneSoap this week in class. PhoneSoap is a product that cleans and charges your phone. This product is solving the issue of dirty phones. Our phones are a lot dirtier than a public toilet, in fact. However, some of the sharks argued that the target market in this case was too small. They argued that not enough people would spend the money or take the time to clean their phones. It was also discussed whether the product would be sold to consumers or to businesses. Examples of businesses this could be sold to are hospitals, schools, or offices. It could also be sold to the everyday consumer for homes. It is important for PhoneSoap to establish their best market and focus on making sure their product to best fit for that target market.